Roger M. EdelenAssociate Professor

Associate Professor Roger Edelen’s primary research interest is institutional investing. Much of his work has focused on the influence of operational and organizational factors on mutual fund performance, particularly relating to funds’ trading practices and shareholder flow. His research also includes the role of agency conflicts in secondary-market trading, and pricing dynamics in primary security offerings. His teaching interests are investments and derivative securities.

Before to coming to UC Davis, Edelen was assistant professor of finance at Boston College and the Wharton School at the University of Pennsylvania. He also gained four years of experience in the investment management industry, acting as director of research at ReFlow Management, a mutual fund liquidity service provider, director of enhanced equity strategies at Mellon Capital Management, providing litigation and financial product development consulting, and options trading with O’Connor and Associates, a Chicago-based market making firm (now UBS).

Story about Graduate School of Management Professors Brad Barber and Roger Edelen, who were awarded Graham and Dodd Scroll Awards from the CFA Institute. The awards recognize outstanding articles published in 2013 in Financial Analysts Journal.

It’s Mutual, We Don’t Like Hidden Fund Expenses: Professor Roger Edelen’s research shows that antsy fund managers trading holdings run up hidden costs that are higher than the funds’ declared expenses and have a significant negative impact on returns. Another good reason to stick with index investments.

Expense ratios are not the only cost you should be thinking about when investing in mutual funds. There’s another significant cost that’s harder to quantify, isn’t disclosed, and remains largely invisible: expenses from the trades that the fund manager makes. “On a practical level, given the current state of affairs, trading costs really are an invisible cost,” says Associate Professor Roger Edelen.

When investors are shopping around for mutual funds, they have a wealth of data at their fingertips. They know, for instance, how much a given fund charges in management and operational fees (its expense ratio). They also know how a particular fund has performed over various time periods and what type of investments management held as of the most recent reporting date.

The Hidden Cost of Doing Business: Investors know that fees are the enemy of return. But many may not realize the hidden costs incurred by their mutual funds. Interesting article by Barron’s about Associate Professor Roger Edelen’s latest research, revealing the three “invisible” costs that are eroding returns.

When investors are shopping around for mutual funds, they have a wealth of data at their fingertips. They know, for instance, how much a given fund charges in management and operational fees (its expense ratio). They also know how a particular fund has performed over various time periods and what type of investments management held as of the most recent reporting date.

The Graduate School of Management hosted its second annual Symposium on Financial Institutions & Intermediaries in March, bringing together two dozen top scholars and industry practitioners from around the world.

Organized by Associate Professors Ayako Yasuda and Roger Edelen, the symposium focused on private equity, an asset class that typically raises capital from institutional investors to invest in companies that are already private or are public and then taken private.

The Graduate School of Management hosted its second annual Symposium on Financial Institutions & Intermediaries in March, bringing together two dozen top scholars and industry practitioners from around the world.

Organized by Associate Professors Ayako Yasuda and Roger Edelen, the symposium focused on private equity, an asset class that typically raises capital from institutional investors to invest in companies that are already private or are public and then taken private.

This is the second annual symposium on financial institutions and intermediaries. Co-chaired by Professor Yasuda and Professor Edelen, this year’s symposium features guests from around the world to discuss key topics on private equity.

Four faculty members have received prestigious fellowships for their research productivity, teaching excellence and dedicated service to the School.

Associate Professor Greta Hsu, a specialist in organizational behavior and economic sociology, was awarded the Seeman Faculty Term Fellowship. The fellowship is made possible by a generous gift from alumna May Seeman ’89 and her husband, Philippe.

Assistant Professors Ayako Yasuda and Roger Edelen recently teamed up to organize the UC Davis Symposium on Financial Institutions & Intermediaries 2011, a one-day conference that brought more than two dozen leading scholars and practitioners to Gallagher Hall on April 1.

This first annual event focused on the nexus of mutual and hedge funds, drawing on the expertise at the School. “Roger and I picked a topic that not only showcased the GSM finance faculty, but one that would encourage engagement from practitioners and academicians alike,” explained Yasuda. “This invitation-only event brought together people knowledgeable about intermediaries from very different perspectives.”

A study by Roger M. Edelen, an assistant professor of management at the UC Davis Graduate School of Management, with colleagues at Boston College, concluded that institutional investors are less reactive to shifts in market sentiment than retail investors and better at collecting and processing information about future prospects.

In this study, Associate Professor Roger Edelen and co-authors Alan J. Marcus and Hassan Tehranian from Boston College measured retail investor sentiment relative to that of institutional investors by comparing their respective portfolio allocations to equity versus cash and fixed-income securities. The results suggest that fluctuations in retail sentiment are a primary driver of equity valuations for reasons unrelated to fundamentals.

This study provides empirical evidence on the role of disclosure in resolving agency conflicts in delegated investment management. For certain expenditures, fund managers have alternative means of payment which differ greatly in their opacity: payments can be expensed (relatively transparent); or bundled with brokerage commissions (relatively opaque).

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The corporate finance concentration is designed to teach the role of accounting in business management, financial planning and decision-making. The study of corporate finance, you develops knowledge in areas such as reporting to shareholders, managing costs, creating shareholder value, measuring performance and making strategic accounting and financing choices.